Global economic growth continues to accelerate
The growth of the world’s economy continued to pick up pace in 2017. Nearly all regions contributed to this expansion, with Europe and Asia particularly exceeding expectations. The latest forecasts factor in the anticipated impact of the US tax reforms that were recently approved. The International Monetary Fund (IMF) 1) is expecting global economic growth of 3.7 per cent for 2017 as a whole, compared with 3.2 per cent in 2016.
The economy of the eurozone grew by 2.4 per cent in 2017, which was considerably stronger than the increase of 1.8 per cent in 2016. Germany’s economy stepped up the pace of growth significantly, expanding by 2.5 per cent year on year (2016: 1.9 per cent). Spain again reported strong growth with a rate of 3.1 per cent (2016: 3.3 per cent). France’s growth rate was also up sharply on the previous year at 1.8 per cent (2016: 1.2 per cent), as was Italy’s at 1.6 per cent (2016: 0.9 per cent).
The economic upturn continued in the USA, where the economy expanded by 2.3 per cent overall (2016: 1.5 per cent). Given the tax cuts and sustained fall in unemployment, this growth is set to continue. The growth of the Chinese economy was on a par with the previous year at 6.8 per cent (2016: 6.7 per cent). Russia’s economy emerged from recession, achieving growth of 1.8 per cent. South America also appears to have turned the corner.
Positive trend in DEUTZ’s customer industries
In 2017, DEUTZ’s main customer markets performed well in all regions. Demand for construction equipment rose by around 13 per cent 2) in Europe, by 5 per cent 2) in North America and by over 30 per cent 3) in China. Europe’s material handling sector grew by 7 per cent 2). In North America 3), the expansion of the material handling sector was comparable with that of the construction equipment sector. In China 3), the material handling market grew at a slightly slower rate than the construction equipment market. Europe’s agricultural machinery sector grew by up to 5 per cent 3). Unit sales of light and medium-duty trucks in China improved by up to 5 per cent 3), while the market for heavy-duty trucks saw very strong expansion.
1) IMF World Economic Outlook Update, January 2018.
2) According to Power Systems Research (PSR).
3) Own estimate.